P4P links Tanzanian smallholders to national food reserve

5 December 2013

The warehouse of the Gallapo SACCOS in Manyara region was rehabilitated under P4P initiative. Thanks to the improved storage capacity and reduced post-harvest losses, Gallapo is now one of WFP’s most reliable P4P-supported vendors. In 2013, they sold 300 metric tons of maize to NFRA. Copyright: WFP/Jennifer Kunz

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Thanks to an agreement between WFP and Tanzania’s National Food Reserve Agency (NFRA), smallholder farmers have gained access to a sustainable market for their crops. By building smallholder farmers’ capacity and connecting them to the NFRA, P4P continues to boost sales and incomes for the farmers and their families, while contributing to the long-term food security of the country.

The agreement between WFP and NFRA, signed in August 2012, formalized the understanding that WFP will purchase food from the NFRA, who in turn will buy from smallholder farmers’ organizations, including those linked to the Purchase for Progress (P4P) initiative.

Supporting smallholder farmers to improve access to markets

In Tanzania, some 85 percent of the country’s maize is produced by smallholder farmers. Low productivity, long distance from markets, a lack of credit, and inadequate storage limit smallholder farmers’ capacity to sell their produce. In 2008, WFP initiated P4P to help smallholder farmers sell their crops at a fair price and increase production to boost their income, creating a more secure future. P4P and partners’ activities have built the capacity of some 5,000 farmers in 28 farmers’ organizations to sell food to WFP and other markets. Since 2009, P4P-supported farmers’ organizations have supplied WFP with 13,000 metric tons – over 500 truckloads – of maize and beans valued at US$ 5.4 million.

Promoting food security in the region

The NFRA is Tanzania’s main food security instrument and first response to localized food emergencies. By buying maize at a fair price from smallholder farmers during harvest time, and selling at reasonable prices to consumers during the lean period, the NFRA contributes to market stability and food security in the country.

In 2011, WFP and the Government of Tanzania accelerated their mutual partnership in support of smallholder procurement, as the NFRA started selling grain to WFP’s operations addressing humanitarian needs in the region.

Tanzania’s as a regional grain trader

“The NFRA provides a service to the nation in times of local food shortages by gathering stocks so that we can effectively manage emergency preparedness and response. At the same time, part of our mission is also to uplift smallholder farmers. We do so by buying directly from farmers’ organizations, at fair prices that is covering their costs for adding quality to the grains. Our relationship with WFP now allows us to extend our response to neighboring countries in East and Central Africa,” said NFRA CEO Charles Walwa. “This is helping Tanzania to be recognized as a food basket for the region, and uplifting smallholder farmers in doing so.”

Between November 2011 and May 2012, WFP Tanzania purchased nearly 100,000 metric tons of grain valued at close to US$ 17 million from NFRA, most of which was delivered to humanitarian operations in South Sudan, Kenya and Somalia. “This marked a significant shift in Tanzania’s role as a regional grain trader,” said WFP Country Representative Richard Ragan. “Not only is the agreement good for the overall economy, it is good for the smallholder farmers who make up 75 percent of Tanzania’s workforce.” Unfortunately a drought in 2012 caused a poor maize production, leaving Tanzania with a short supply nationwide. Because of this, WFP has not been able to buy any maize from NFRA in 2013.

Successful deliveries so far

In July 2013, as a step towards fulfilling the formal agreement, 17 P4P-supported farmers’ organizations signed delivery contracts with the NFRA. As of November 2013, farmers’ organizations have aggregated and delivered a total of 2,500 metric tons of maize to the NFRA.

P4P-supported farmer in his maize field in Arusha region. Copyright: WFP/ Jennifer Kunz

The capacity building activities provided to facilitate the successful sales have included training and technical assistance to improve farmer organization’s governance, organizational structures, post-harvest management, marketing and production activities. P4P investment has also rehabilitated 23 village warehouses to facilitate aggregation and collective marketing. Ten of the warehouses have met the Tanzanian Warehouse Licensing Board criteria and are currently being registered as part of the new national Warehouse Receipt System.

Exploring deepened collaboration

Now both organizations are looking to the future. While NFRA’s procurement activities are usually completed from July through October, many farmers’ organisations still have additional stocks ready to market beyond October. P4P will continue to make efforts and strengthen farmers’ organisations’ capacity to compete and sell as much as possible during the NFRA purchase campaign. Furthermore, WFP Tanzania is also exploring possibilities to buy maize from smallholder farmers’ organizations between October - December, to help complement the NFRA procurement activities. “This would optimize both WFP and the NFRA’s impact on the business of smallholder farmers.” said Mr Walwa.

With NFRA’s procurement shift of focus to include smallholder farmers’ organizations, instead of dealing only with larger traders, one of the primary objectives of the P4P initiative in Tanzania is being met – farmers’ organizations have established a market beyond WFP and in doing so are becoming part of the solution to food insecurity in Tanzania.

Hunger can be eliminated in our lifetimes

This requires comprehensive efforts to ensure that every man, woman and child enjoy their Right to Adequate Food; women are empowered; priority is given to family farming; and food systems everywhere are sustainable and resilient.